Daily Market Report 02/01/12

GOLD

Gold is continuing its fast paced increase that started in January (10.8%), the best January increase in 32 years. Today at 11am PST, gold is up $10.40, trading at $1,746.20 per ounce on with excellent volume.

The World’s central banks have become net purchasers of gold bullion after many years being net sellers.  In 2011 central banks purchased 430 tonnes of gold, five times more than in 2010, and the highest since 1964. Much of this new demand has come from ‘emerging markets’ central banks like Mexico, Russia, Turkey, South Korea and of course China and India.

SILVER

Silver’s recent increase has outpaced Gold’s stellar performance. Today, Silver has increased another $0.29, trading at $33.85 per ounce at 11am PDT.  For a brief time last night Silver traded over $34 per ounce, reaching $34.13 per ounce before we saw resistance.   $34 per ounce should not be a major resistance level in the face of the strength in the Gold price. 

Other Important news that affects precious metal prices:

China’s official Purchasing Managers’ Index showed the manufacturing sector expanded modestly in January, with the index reading inching up to 50.5 from 50.3 in December, above a 49.5 reading forecast.